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The old Interplay logo, used on the cover of the title Wasteland as taken from Brian Fargo's Twitter account. He states the logo was intended to resemble a person sat at a keyboard.[6]

The company was founded in October 1983[7] as Interplay Productions in southern California with Brian Fargo as CEO, and programmers Jay Patel, Troy Worrell, and Rebecca Heineman all of whom had previously worked with Fargo at a small video game developer called Boone Corporation.[8] The first projects were non-original and consisted of software conversions and even some military work for Loral Corporation.[7] After negotiations with Activision, Interplay entered a US$100,000 contract to produce three illustrated text adventures for them.[7] Published in 1984, Mindshadow is loosely based on Robert Ludlum's Bourne Identity while The Tracer Sanction puts the player in the role of an interplanetary secret agent. Borrowed Time which features a script by Arnie Katz' Subway Software followed in 1985.[9] These adventures built upon work previously done by Fargo: his first game was the 1981-published Demon's Forge.[7][10]

By 1998, the financial situation at Interplay was dire and the company was in bankruptcy court. To avert bankruptcy Interplay went public in order to raise capital and pay off debt. Interplay was successful in its public offering and avoided bankruptcy. Shares were sold on the NASDAQ Stock Exchange and Interplay changed its name to Interplay Entertainment Corp.

Interplay continued to endure losses under Brian Fargo due to increased competition, less than stellar returns on Interplay’s sports division and the lack of console titles. This forced Interplay to seek additional funding two years later with an investment from Titus Software, a Paris-based game company. Titus agreed to invest 25 million dollars in Interplay and a few months later this was followed up by an additional 10 million investment.[12] Interplay also owned half of the UK based publisher Virgin Interactive with Titus owning half of the company, with this Interplay would be able to publish Virgin's games in North America. Even though Interplay released critically acclaimed games such as Descent 3 and FreeSpace 2 the company reported several additional quarters of losses.

By 2001, Titus Software completed its acquisition of majority control of Interplay. Immediately afterwards, they shed most of Interplay's publisher functions and signed a long-term agreement under which Vivendi Universal would publish Interplay's games. Eventually, Interplay founder Brian Fargo departed at the start of 2002 to found InXile Entertainment as Fargo's plan to change Interplay's main focus from PC gaming to console gaming failed.[13]

Herve Caen took over the role of CEO to perform triage and made several unpopular but arguably necessary decisions to cancel various projects, in order to save the company. Interplay sold Shiny Entertainment to Infogrames and several game properties while closing BlueSky Software. Due to a low share price, Interplay's shares were delisted from the NASDAQ in 2002 and now trade on the over the counter (OTC) market.[14] In Interplay's European operations were completely sold to Titus Software in 2002 which included their share of Virgin Interactive, which Titus renamed to Avalon Interactive in August 2003, with this Titus had complete control to publish and distribute Interplay's games in Europe under the Avalon Interactive name. On December 8, 2003, Interplay laid off the entire Black Isle Studios staff.[15] The company got involved in issues including debt. Feargus Urquhart later left Black Isle Studios and the Interplay suffered a loss of 20 million USD during the year.[16]

In 2005, Titus Software filed for bankruptcy and closed down all their assets which Interplay acquired parts of. The bankruptcy of Titus led to Interplay being burdened with debt. Interplay faced bankruptcy again and was brought to bankruptcy court in 2006. In order to pay off creditors the company altered its licensing agreement with Bethesda Software and then sold the Fallout IP to Bethesda Softworks in 2007.[17][18]

Interplay retained back-licensing rights to Fallout Online and the rights to sell the original Fallout games. Interplay began development of Fallout Online in 2007. Following a lengthy lawsuit by Bethesda Softworks, both sides agreed to a settlement where Interplay would receive 2 million dollars and the rights to sell the original Fallout games for a limited time.

In September 2008 several games of Interplay's catalogue were re-released on the digital distribution service gog.com after being non-available in retail distribution for years, for instance Descent + Descent 2.[19][20] Descent 1 and 2 were also released on Steam in February 2014.[21][22]

In 2013, Interplay acquired the remaining rights to the FreeSpace franchise for $7,500 after THQ went to bankruptcy court.[23]

In 2003 and 2004 Snowblind Studios and Interplay Entertainment were engaged in a dispute regarding the Dark Alliance Engine for Fallout: Brotherhood of Steel, Baldur's Gate: Dark Alliance II, and the GameCube version of the original Dark Alliance. The dispute was resolved and Interplay would be allowed to work with materials already using the Dark Alliance Engine.

Bethesda Softworks sued Interplay in 2009, regarding the Fallout Online license and selling of Fallout Trilogy and sought an injunction to stop development of Fallout Online and sales of Fallout Trilogy. After several trials spanning almost three years, and in exchange for 2 million dollars, Interplay gave to Bethesda full rights for Fallout Online. Interplay's rights to sell and merchandise Fallout, Fallout 2 and Fallout Tactics: Brotherhood of Steel expired on December 31, 2013.[24]

In 2010, Topware Interactive revealed that they were developing Battle vs. Chess to be published by SouthPeak Games. Interplay sued them and won an injunction to stop sales in the United States. In 2012, Interplay won the case via default and a settlement for $200,000 plus interest was agreed upon on November 15, 2012 but according to PACER,[25]

Following the victory over Topware, Interplay began working on releasing a new version of Battle Chess for the PC. Battle Chess: Game of Kings, initially developed by Subdued Software, marked Interplay's first Kickstarter with a goal of $100,000. Ultimately, Interplay failed to reach the goal and the project was placed on hiatus following the closure of Subdued Software. Eventually, after handing the project off to a different studio, Olde Skuul, the project was finished and released on Steam.[26] Interplay, while also releasing the Descent series to Steam,[27][28][29][30][31] then began to develop FreeSpace Tactics, based on Descent: FreeSpace. Eventually creating another Kickstarter to fund the project, Interplay once again failed and cancelled the crowdfunding operation.[32]

Interplay's interest in the Descent series eventually resulted in them licensing the name out to Descendent Studios. In March 2015 Descendent Studios launched a Kickstarter campaign to make a Descent prequel titled Descent: Underground. On April 10, 2015, Descent: Underground's campaign finished successfully, raising $601,773 on a goal of $600,000; this marked the first successful Kickstarter for an Interplay-owned property.[33]

On September 7, 2016, a press release was published on Nasdaq Newswire reporting that Interplay will be selling their library of intellectual properties, including video game assets. The sale included 70 titles and "dozens of characters." Investment firm Wedbush Securities is orchestrating the sale.[34]

On September 29, 2017, Descendent Studios, who are licensing Descent from Interplay, announced they would be removing Descent Underground from Steam Early Access, and signing a distribution deal with Little Orbit which will allow them to do a larger single player campaign as well as improve the game from top to bottom and to launch on both the Xbox One, as well as the PS4 in the fall of 2018. Little Orbit has signed on to help market and distribute the Descent brand starting with this first chapter of the reboot of the Descent franchise.[35]

Interplay Discovery, a subdivision of Interplay aimed at publishing games made by indie developers.

Interplay Films, a division of Interplay Entertainment, was formed in 1998 and was supposed to develop seven of the company’s most popular video game titles into movies, including Descent, Redneck Rampage and Fallout. Its president was Tom Reed.

Interplay Sports located in Beverly Hills was the internal sports division at Interplay. The division was founded in 1995 as VR Sports,[41] but changed its name in 1998.[42]